A New Concern for Content Licensors: Perpetual Licensees Deemed to Be Owners

With the tremendous growth of digital media, content such as music, images, books, and software is increasingly distributed pursuant to a license rather than by a traditional sale with a transfer of title. The distinction between a traditional sale and a license can be important, because a “licensee” is not necessarily given the same rights under the Copyright Act as an “owner” who purchases a work and acquires title to it. Two courts in the Ninth Circuit have recently addressed how to differentiate between an “owner” and a mere “licensee” for purposes of rights under the Copyright Act, and have reached decisions that might surprise many practitioners.